This latest Property Market-Index report provides a comprehensive overview and ratings index of Portugal’s property hotspots, alongside insight into how international investment, regeneration, culture, heritage and tax incentives for affluent expats are fuelling growth in this marketplace.
Access Property Market-Index’s Portugal Property Hotspots Report 2024 – 2025 in full here.
The report reveals that the Portuguese property market is forecast to grow by 5.8% in 2025, with key regions like Lisbon, Algarve, and Porto leading the way. Portugal will also outperform the broader EU market, which is expected to decline by 2.5%.
The Portuguese property market also continues to be fuelled by an influx of international investment and affluent expats moving to Portugal for lifestyle and investment reasons as well as safety, security, and freedom of access to the twenty-nine EU Schengen region countries.
This, combined with Portugal’s Non-Habitual Residency (NHR) tax incentives, has made some of these Portuguese real estate markets highly desirable. This NHR tax regime offered significant tax savings to affluent ex-pats on their non-Portugal-derived passive income, but that is set to end for new entrants in 2025.
The new tax regime that’s replacing NHR in 2025, often referred to as NHR 2.0, is more aligned to incentivising highly-skilled professionals, innovators and entrepreneurs, or their investors, and will offer significant tax benefits on professional income, capital gains tax at 0% on non-Portugal derived assets.
The report states that the Algarve property market saw an increase of 15% in the past year. In the recent summer months of 2024, locations such as Silves in Central Algarve saw a 10.9% increase, with Ferragudo seeing a 9.6% increase, followed by Lagos in the Western Algarve at 9.7% and Tavira, east of Faro, seeing a 9.5% growth.
The Golden Triangle areas such as Vale do Lobo, Vilamoura, and Loule have seen a growth of 5.8% in comparison and Albufeira saw similar growth this summer.
In 2024, ten properties were sold for every new one built, creating persistent upward pressure on prices, especially in sought-after regions, with similar trends expected in 2025.
These factors are ensuring that the Portugal real estate market is growing at double the pace of the rest of Europe and most of North America regarding property price values.
These findings consider the key metrics linked to buying property in Portugal’s most sought-after areas.
We have evaluated and weighted these metrics based on areas that index over 100 based on the following key factors:
- Security
- Regeneration investment
- Growth trends
- Culture
- Education
- Heritage
- Investment potential
- Land availability
- Infrastructure
- Connectivity
- Amenities
- Health and well-being
- Sustainability
To access this full report, click the link here.